• The annual bonus opportunity is signi cantly below GKN’s international peer groups, including our US competitors. The US is an important market for us, where we generate around one third of our sales and compete for talent. We do not expect to match reward packages in that market, but having recently lost some senior US executives, we cannot ignore its practices. • The retention risk is exacerbated by the fact that the 2013 SEP award will not pay out in 2016 and subsequent awards now look unlikely to vest in 2017 or 2018. While management pro t before tax has grown steadily, slowing global GDP and an increasing tax rate for GKN mean that an annualised compound growth in EPS of 6% to 12% is overly stretching. • The resignation of three senior executives in recent years, including the resignation in 2015 of Andrew Reynolds Smith to join another industrial company, emphasises the importance of ensuring that our reward packages are competitive. While we believe we currently have a very strong executive team, the Committee is mindful of the importance of a period of stability to the long-term success of the Group. The Committee has carefully considered these points against the challenging stock market conditions seen at the start of 2016. Following shareholder consultation we have decided not to propose any policy changes for 2016 but to help address the above issues we have implemented some changes within our existing remuneration policy, as described below. We will carry out a full policy review during the course of 2016; it is likely that we will propose further changes in 2017 when the remuneration policy comes up for approval by shareholders under the normal three-year cycle. We will retain our rigorous, principled and fair approach to setting reward levels, while seeking to ensure that we can attract, motivate and retain the right talent across our global markets.